Commercial real estate transactions are tricky. Without assistance from an experienced commercial real estate attorney, you may succumb to a few common pitfalls. Knowing the most frequent issues and how to prevent them can help you enjoy a seamless, successful sale or purchase of commercial realty. Here are the five most common problems people encounter:
- Environmental Hazards
Always check for a history of environmental issues and hazards prior to purchasing or acquiring a piece of commercial real estate. Commercial properties can cause problems such as pesticide drainage, mold problems, poor air quality, and toxic substance exposure. Make sure you will not become liable for environmental hazards that existed on the property before you purchased it.
- Inaccurate Property Evaluation
Check with a real estate agent or lawyer to verify the accuracy of real property documents and legal descriptions of property. The previous owner may have had inaccurate information that led to official documents mapping the wrong boundary lines and other real property elements. Hire your own land surveyors to double check all facts about the land before buying or selling for the most accurate valuation.
- Costly Legal Errors
Many things could go wrong with a commercial real estate transaction from a legal perspective. One of the most common issues is that the seller does not divulge potential issues with the property such as strict zoning laws, liens against the property, and problematic encroachments. Before you purchase a property, request a full evaluation of it from an attorney to avoid costly errors.
- Lack of Financing
As a seller, investigate how the buyer will be paying for or financing the property before agreeing to the transaction with him or her. Many sellers run into significant issues trying to get the buyer to keep up with a leasing agreement or payment schedule after finalizing the transaction. Prevent this problem before it starts by hiring a lawyer to investigate the buyer. Risk management is important in commercial real estate sales.
- Title Problems
Performing a commercial real estate transaction without help from an attorney is asking for title problems. Doing just one thing wrong during the transaction could result in contract and ownership issues. You might discover a harmful title defect after you’ve already purchased the property, or discover that the person you bought it from wasn’t the true owner at all. Hiring a lawyer can help you prevent these serious pitfalls.
Need help with a commercial real estate contract, development, or dispute? Contact Dallas real estate lawyer Bruce Turner today.